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S'pore resilient to global financial shocks: Moody's |
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Headlines—Singapore
SINGAPORE - Moody's Investors Service yesterday reaffirmed Singapore's top Aaa rating, saying the Republic had demonstrated a very high degree of resilience to global financial shocks despite the openness of its economy and its dependence on global trade and finance.
Singapore's Aaa sovereign rating and stable outlook reflected Moody's assessment in four factors, namely its "very high" economic, institutional and Government financial strengths, as well as its "low" susceptibility to risks from financial, economic and political events, the ratings agency said.
According to the new Moody's report on Singapore, the substantial accumulation of public savings, along with fiscal prudence and a fully-funded public pension system, supports the Government's strong financial position.
Singapore's "very high" economic strength reflects the trend of a high growth rate for an advanced economy, as well as high per-capita income.
The Republic's economy expanded by 10 per cent in the first three months of the year from the previous quarter.
Singapore's scores on these metrics have exceeded the Aaa medians in both real gross domestic product growth and per-capita income in terms of purchasing power parity over the last ten years, the ratings agency said.
In addition, sound regulatory and supervisory frameworks have helped foster a strong and well-managed financial system. These factors, coupled with a competitive economy and investment regime, have led to a strong external position, according to Moody's.
It also noted that Singapore has one of the world's largest net asset international investment positions and its strong balance sheet has ensured debt affordability and buffers external shocks.
The Government has also maintained the focus of its monetary policy on financial prudence while accommodating demands for greater social equity.
Moody's said its rating was also supported by the track record of political stability and social cohesion since Singapore's independence despite the gradual increase in the opposition to the ruling party's monopoly on political power.
Challenges facing the authorities include containing consumer price and property inflation over the near term, and fostering a growth model that is driven by productivity and innovation over the longer term, Moody's said.
Today
20 June 2012
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